The Denver Broncos finally traded quarterback Tim Tebow to the New York Jets, a league source told NFL Network's Michael Lombardi on Wednesday night, eight hours after the teams initially agreed to the deal, then hit a snag over money.

A league source told Lombardi that Tebow was given the option of joining either the Jets or his hometown Jacksonville Jaguars, who had jumped back into discussions, but the quarterback decided New York was the best choice. However, Tebow denied in his conference call with New York media that he was allowed to pick his destination.

The Broncos later confirmed the trade and said they received the Jets' fourth-round and sixth-round picks in the 2012 NFL Draft. The Broncos also gave the Jets their seventh-round selection this year.

Also, $2.53 million of $5 million in guarantees in Tebow's contract goes back to Denver from New York over the next two years, a league source told NFL Network insider Jason La Canfora.

"Tim Tebow deserves an enormous amount of credit for what he accomplished and how he carried himself during his time with the Broncos," Broncos executive vice president of football operations John Elway said in a statement released by the team. "From taking over a 1-4 team and leading it to the playoffs to energizing our fans and this community, Tim left an extraordinary mark on this organization. His time in Denver will always hold a special place in Broncos history.

"Our goal was to do the best thing for Tim and the Broncos, and I believe the opportunity that presented itself with the New York Jets accomplishes that objective. Tim made a lot of strides last year and has a very promising career ahead of him. If anyone is willing to put the work in to be great, it's Tim Tebow."

The Broncos started shopping Tebow after signing four-time NFL MVP Peyton Manning on Tuesday, and the Jets went hard after the former University of Florida star, envisioning him as a versatile complement to starter Mark Sanchez, who received a $40.5 million contract extension, with $20.5 million guaranteed, earlier this month. The Jets also had pursued Manning, but they fell out of that race early when there wasn't mutual interest.

As part of Tebow's five-year, $11.25 million contract that he signed as a rookie in 2010, he had a $6.277 million advance due to him 29 days after the start of the 2011 league year. That money was paid to him in August after the NFL lockout ended. The trade stalled over the payment the Jets would owe the Broncos from that advance, allowing the Jaguars to leap back into the hunt.

"Earlier this week, I asked Gene Smith and his staff to explore the potential of acquiring Tim Tebow," Jaguars owner Shahid Khan said in a statement released by the team. "I think we have a duty to consider all avenues of improving the Jaguars on and off the field, especially given the unique circumstances involving the player. I appreciate the high level of due diligence Gene and his staff dedicated to this matter even as late as this evening, and I am very satisfied with the outcome. Our commitment to developing Blaine Gabbert was, and still is, central to our goal of returning the Jaguars to elite status in the NFL. We're looking ahead with zero regrets."

Tebow will make $1.1 million in 2012, but La Canfora points out many have overlooked that the quarterback achieved significant escalators in his deal based on his increased playing time and performance in 2011. In 2013, Tebow's base salary is $6.055 million, and in 2014, it's $7.145 million.